Intellectual Property Law

Whitman Leaves Just as Skype Starts to Do Alright

By Cynthia Brumfield

That rarest of all species, a potent female CEO of a major company, and one who wielded power in the all-male bastion of Silicon Valley no less, is stepping down from her top dog role and it's kind of a bummer. As has been widely rumored eBay's CEO Meg Whitman is relinquishing the top slot as of March 31, to be succeeded by eBay Marketplace president John Donahoe as part of a big management shake-up at the company.

She's going out on a high note after 10 years leading the company, building it from a 30-person, $4.7 million operation into a 15,000-employee, $7.7 billion industry leader. During Q4 07, eBay saw profits jump 53% and revenue jump 27%.

But looked at through the topsy-turvy funhouse mirror through which Wall Street seems to view tech companies these days, eBay is a bad bet. Shares of the company dropped 5% in after-hour trading because eBay forecast 2008 revenues to be $8.5 billion to $8.75 billion, only 10% higher than 2007 levels. Wall Street wants more than that, however. (eBay's revenue forecasts are premised on an idea that the still-vibrant but ailing giant needs to rejigger its pricing structure to invigorate its massive auction business.)

Whitman is also leaving the top job at a time when her most controversial business deal, the $2.6 billion acquisition of online VoIP company Skype, is starting to look like, well, if not a good deal then not the horrible deal it has seemed to be. Skype added 30 million net new registered users during Q4 07, the second highest quarterly gain in the service's history.

Revenue from Skype jumped by $17 million during the quarter, the single biggest quarterly revenue jump in Skype's history, while revenue per registered user hit an all-time high of $.42 (most Skype users pay nothing for the service.) So, despite eBay's past pain in writing off the expensive acquisition, at least Skype is not a total dog.

Full post as published by IP Democracy on January 23, 2008 (boomark / email).